The owner of Upper Crust and Camden Food Co. SSP will issue new shares and slash jobs it said in a wide-ranging trading update on its strategy to survive the coronavirus slump.
SSP will close outlets and reduce staff after encountering a 85 per cent plunge in business across its European sites amid the coronavirus outbreak.
And it expects trading conditions to worsen.
SSP, which operates predominantly in now-empty train stations and airports said it had agreed a new £112m, 18-month credit facility with its banks, subject to it completing a new issue of shares worth roughly 20 per cent of its share capital.
The Upper Crust owner said it will apply for coronavirus support from the government schemes announced by chancellor Rishi Sunak last week.
Shares in SSP jumped 14.6 per cent on the news, amid a wider coronavirus rebound.
Another divi cut
Investors will miss out on a dividend for the first half of 2020 and SSP will defer payment of another dividend already announced.
The food retailer also said it has suspended its £100m share buyback.
On jobs, SSP did not give details except to say layoff had already begun and senior staff and the board could expect “significant salary reductions”.
The company’s expansion plans are in a holding pattern and it is in ongoing discussions with landlords about its rent bill.
On debt issues, it said that it was confident in its ability to meet its covenant thresholds on 31 March and expected to have up to £200m of cash and undrawn committed facilities, before the new funding, at the end of the first half.
It forecast March revenue to drop by up to 45 per cent compared with last year, reducing revenue by about £125m to £135m and operating profit by up to £60m.